Alkane Resources (ASX: ALK) has boosted the potential of its Tomingley gold mine after drilling uncovered “significant” gold at the nearby El Paso prospect.
Diamond and reverse circulation drilling were carried out over 480m of strike at the prospect with a notable intersection of 12m at 4.99 grams per tonne gold from 108m, including 3m at 11.15g/t from 108m.
The intersection includes numerous deeper higher-grade intervals such as 6m at 10.65g/t gold from 144m, including 3m at 17.8g/t gold from 171m.
According to Alkane managing director Nic Earner, El Paso is the company’s third near mine discovery at Tomingley, with El Paso located only 7km from the project’s existing processing plant.
The El Paso discovery was part of Alkane’s extensive regional exploration program to pinpoint additional resources that could be mined and fed to the current processing plant.
Other discoveries include the Roswell and San Antonia prospects, which are also within 7km of the plant.
In addition to recent drilling at El Paso, Alkane carried out 3,000m of reverse circulation drilling to test mineralised extensions at Roswell and San Antonio. Assays from this drilling are pending.
“Together with the Roswell and San Antonio prospects, we now have over 2,500m strike length that is still open to the south towards Peak Hill,” Mr Earner explained.
“We’re looking forward to announcing further drill results in the coming weeks, and confirming the potential for substantial mine life extension,” he added.
Tomingley gold operation
Located in central New South Wales, Alkane has been producing from Tomingley since 2014.
During the March quarter, gold production from Tomingley was 10,669 ounces, with sales bringing in $19.9 million in revenue based on an average gold price of A$1,841/oz.
All in sustaining costs were $956/oz, with 2019 financial year gold production estimated to be between 42,000oz and 47,000oz with AISC ranging from $950-$1,100/oz.
At the end of the quarter, Alkane had $78.8 million in cash, bullion and listed investments and the company is currently looking for investment opportunities.